Insurance Terms

Insurance is one of the important needs if you want to have stable and healthy personal finances. In addition to adequate emergency funds, ownership of protection is something that should not be delayed. By having insurance, personal finances can be protected from the risks of loss that may occur when dealing with a condition that requires large costs. For example, when you fall sick and need medical expenses or when the backbone of your family dies due to an accident, your family income stops.


Insurance policy
Insurance Policy is a term to refer to a written cooperation agreement contract between the Insurance Provider Company (Insurance Insurer) and the customer of the Policy Holder. All Insurance contracts, whether it is Life Insurance, Health Insurance to Loss Insurance, are referred to as Insurance Policies.

The content of the cooperation agreement contained in the Insurance is an agreement that the Insurance Provider is willing to bear the risks owned by the Insured whose name is stated in the policy, within a certain period of time according to the agreement. To get insurance protection from the insurance provider, the policyholder is required to pay an agreed premium fee.


Insurance premium
To get insurance protection, the policyholder is required to pay a premium to the insurance insurer. Insurance Premium is defined as the amount of payment determined as the cost of transferring risk from the Policy Holder to the Insurance Provider. The amount of the Premium is determined by the Insurance Provider and agreed by the Policy Holder. The size of the premium will be determined by many factors. Among other things, the coverage of protection provided by the Insurance Provider, the age of the Insured, the Insured’s lifestyle or medical record, gender, to the Insured’s occupation.


Insured
The term “Insured” in an Insurance Policy refers to the person or party who obtains compensation from the Insurance Provider when the risk referred to in the Policy occurs. In a Life Insurance Policy, the Insured is the head of the family or a family member who has economic value. In Health Insurance, the Insured can be anyone such as employees, children, wives, parents, and so on. Thus, when there is a risk covered in the Policy, the Insured will get compensation. For example, when the head of the family who is the insured in the life insurance policy dies, the sum insured for life insurance will be given by the insurance provider to the beneficiary who has been appointed in the policy.


Insurance Benefits
Insurance Benefit means the protection obtained by the Insured Insurance and provided by the Insurance company. For example, a health insurance provides benefits for medical care costs, outpatient costs and surgical benefits. That means, when the Insured falls sick and requires treatment, the Insurance provider will provide reimbursement for medical care costs.


Lapse
The Policy Holder is required to pay a certain amount of Premium to the Insurance Provider according to the agreement in the Policy, so that the Insurance Benefits can still be obtained for the duration of the contract. So, if the Policy Holder does not pay the required Premium beyond the Grace Period (generally 45 days), then the Insurance Policy that is owned will be automatically canceled or lapsed. Avoid policy cancellations by ensuring premium payments are on time according to the payment term you have chosen.

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